Bethenergy Mines, Inc. v. Director, Office of Workers' Compensation Programs, No. 93-3428

• Court: United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
• Writing for the Court: SLOVITER
• Citation: 32 F.3d 843
• Parties: BETHENERGY MINES, INC., Petitioner, v. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United States Department of Labor and Catherine Pierson, widow/Bernard, Respondents. BETHENERGY MINES, INC., Petitioner, v. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United States Department of Labor and William LeJuene, Respondents. BETHENERGY MINES INC., Petitioner, v. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United States Department of Labor and Thomas Grassa, Respondents. BARNES AND TUCKER COMPANY, Petitioner, v. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United States Department of Labor and George Lubert, Respondents. BETHENERGY MINES INC., Petitioner, v. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United States Department of Labor and Mary Bohachick, widow/Samuel, Respondents. BETHENERGY MINES, INC., Petitioner, v. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United States Department of Labor and Industry; Patricia J. Doty, (o/b/o James Levanoff Deceased), Respondents. to 93-3432 and 93-3463.
• Docket Number: No. 93-3463,Nos. 93-3428,No. 93-3429,No. 93-3431,No. 93-3428,No. 93-3430,No. 93-3432
• Decision Date: 15 August 1994

Page 843

32 F.3d 843 63 USLW 2139 BETHENERGY MINES, INC., Petitioner No. 93-3428,
v.
DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United
States Department of Labor and Catherine Pierson,
widow/Bernard, Respondents.
BETHENERGY MINES, INC., Petitioner No. 93-3429,
v.
DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United
States Department of Labor and William LeJuene,
Respondents.
BETHENERGY MINES INC., Petitioner No. 93-3430,
v.
DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United
States Department of Labor and Thomas Grassa, Respondents.
BARNES AND TUCKER COMPANY, Petitioner No. 93-3431,
v.
DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United
States Department of Labor and George Lubert, Respondents.
BETHENERGY MINES INC., Petitioner No. 93-3432,
v.
DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United
States Department of Labor and Mary Bohachick,
widow/Samuel, Respondents.
BETHENERGY MINES, INC., Petitioner No. 93-3463,
v.
DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, United
States Department of Labor and Industry; Patricia
J. Doty, (o/b/o James Levanoff
Deceased), Respondents. Nos. 93-3428 to 93-3432 and 93-3463. United States Court of Appeals,
Third Circuit. Argued May 6, 1994.
Decided Aug. 15, 1994.

Page 844

John J. Bagnato (argued), Spence, Custer, Saylor, Wolfe & Rose, Johnstown, PA (Mari Ann Hathaway, Ceisler, Richman, Smith, Washington, PA, of Counsel), for petitioners.

Thomas S. Williamson, Jr., Sol. of Labor, Donald S. Shire, Asst. Sol., Michael J. Denney, Counsel for Enforcement, Deborah E. Mayer (argued), U.S. Dept. of Labor, Washington, DC, for the Director, Office of Workers' Compensation Programs.

Before: SLOVITER, Chief Judge, HUTCHINSON, Circuit Judge, and DIAMOND, ^* District Judge.

Page 845

OPINION OF THE COURT

SLOVITER, Chief Judge.

The issue presented by this appeal is a jurisdictional one pending as well in three other courts of appeals ¹--whether the administrative bodies that adjudicate black lung claims or the district courts have jurisdiction to resolve disputes regarding interest assessed against coal mine Operators on reimbursements to the Black Lung Disability Trust Fund (the "Fund") for medical benefits that the Fund previously paid to or on behalf of claimants. Underlying this jurisdictional dispute is a significant legal issue, which is the authority of the Department of Labor (the "Department") to assess interest against Operators and carriers on such claims for the period before the responsible party has had the opportunity to review the data supporting the medical benefit. Because of the jurisdictional dispute, the legal issue has not been presented here or in the other three circuits, despite the apparent agreement among the parties that there is not likely to be much litigation over the amount of interest once that underlying issue is finally resolved.

In the matter before us, the Benefits Review Board (the "Board" or "BRB") determined that these actions may only be heard by the district courts. Accordingly, it affirmed the decision of the Administrative Law Judge dismissing the actions. BethEnergy Mines, Inc. and Barnes and Tucker Company, coal mine Operators, filed this petition for review as part of a series of test cases. This court has jurisdiction over petitions for review of final orders of the Benefits Review Board pursuant to 33 U.S.C. Sec. 921(c) (1988).

I.

A.

Background

The Black Lung Benefits Act ("the Act"), 30 U.S.C. Sec. 901 et seq., establishes a comprehensive legislative scheme designed to compensate miners for medical problems and disabilities related to pneumoconiosis (black lung disease).

The Act incorporates by reference the claim management and adjudication procedures of the Longshore and Harbor Workers' Compensation Act (the "Longshore Act") to govern the Department of Labor's administration of Part C of the Act (the employer-funded federal workers' compensation program applicable to employees who have become totally disabled or died due to pneumoconiosis.) See 30 U.S.C. Sec. 932(a) (incorporating most of 33 U.S.C. Secs. 901-950); see also Louisville and Nashville R.R. Co. v. Donovan, 713 F.2d 1243, 1247 n. 2 (6th Cir.1983), cert. denied, 466 U.S. 936, 104 S.Ct. 1908, 80 L.Ed.2d 457 (1984).

In this case, our concern is with claims made to the Department of Labor for medical benefits only. Therefore, there is no need to review the history of the involvement of the Social Security Administration and the manner of resolving claims made for miners' disability or death, all of which has been reviewed in prior cases. See, e.g., Pittston Coal Group v. Sebben, 488 U.S. 105, 109 S.Ct. 414, 102 L.Ed.2d 408 (1988); Mullins Coal Co. v. Director, OWCP, 484 U.S. 135, 108 S.Ct. 427, 98 L.Ed.2d 450 (1987); Elliot Coal Mining Co. v. Director, OWCP, 17 F.3d 616, 627-628 (3d Cir.1994); Helen Mining Co. v. Director, OWCP, 924 F.2d 1269, 1271-72 (3d Cir.1991).

As is set forth in these cases, the Act established the Black Lung Disability Trust Fund, which is financed by a manufacturer's excise tax on coal. That Fund pays benefits directly to claimants not only when there is no responsible Operator, but also before a responsible Operator is determined and in other circumstances established by law. See e.g., Elliot Coal, 17 F.3d at 628; Helen Mining, 924 F.2d at 1272; 20 C.F.R. Sec. 725.522 (1993).

In certain circumstances, as those presented in these cases, when miners seek payment

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of medical expenses incurred for treatment of pneumoconiosis ("medical benefits only" or "MBO" claims), the Fund pays claimants before Operator liability is determined, see 20 C.F.R. Sec. 725.701A(b), and the Department will seek reimbursement from the responsible Operator. Sometime in 1988, the Department adopted a new agency policy to collect interest on medical expenditures made by the Fund and later reimbursed by the Operator or carrier. Pursuant to this policy, the date on which the Fund paid the medical bill is the accrual date for interest. See 20 C.F.R. Sec. 725.608(b).

B.

Proceedings in these cases

Although the facts of each of the six consolidated cases vary somewhat, those common to all make them appropriate for joint disposition here. In each case, after determination that a valid MBO claim had been submitted, the district director ² approved the claimant's request for medical treatment expenses; determined that one of the petitioners was the responsible Operator; and, either some time before or after determination of the responsible Operator, received a request from the claimant or his medical providers for payment for specific bills or treatment which, after the Department or its agent approved, was paid by the Trust Fund. ³ Thereafter, the Department sought reimbursement from the Operator. In many of the cases the Operator, as is its right, requested documentation for the medical expenses. In all of the cases before us, the Operator ultimately reimbursed the Fund for its payment (referred to by the Operators as reimbursement of the "principal" paid.)

Following the Operator's acceptance of responsibility for the MBO, the Department of Labor, pursuant to Department policy, billed the Operator for the interest due on the underlying claim. As noted above, the interest was assessed from the date the Fund paid the claim. In the cases before us, it appears that this interest period may have covered from five to nine years. App. at 94-97; App. at 138, 140, 141. In each case, the Operator challenged this assessment of interest and the case was referred to Administrative Law Judge G. Marvin Bober, who consolidated the six cases for joint resolution. The ALJ, believing that the issue was governed by the decision of the Court of Appeals for the Sixth Circuit in Youghiogheny & Ohio Coal Co. v. Vahalik, 970 F.2d 161 (6th Cir.1992), dismissed the cases for lack of jurisdiction in September 1992.

The Operators appealed the six cases to the Benefits Review Board, which held them in abeyance pending its resolution of Brown v. Sea "B" Mining Co., 17 Black Lung Rep. (MB) 1-115, 1993 WL 172283 (Ben.Rev.Bd.1993) (en banc). After it decided Sea "B", the Board dismissed these cases for lack of subject matter jurisdiction. The Operators appealed this decision to this court, filing petitions for review in the six cases on September 2 and 15, 1993.

II.

The existence of subject matter jurisdiction is a question of law over which this court exercises plenary review. See Connors v. Tremont Mining Co., 835 F.2d 1028, 1029 (3d Cir.1987).

A.

Right to a Hearing Before an ALJ

The Operators argue that the failure of the ALJ and the Board to exercise jurisdiction over this case has denied them the right to a hearing and review thereof as guaranteed in 33 U.S.C. Secs. 919 and 921 (1988). The Act provides that claims are filed with the deputy commissioner who has "full power and authority

Page 847

to hear and determine all questions in respect of such claim." 33 U.S.C. Sec. 919(a) (emphasis added). Should any interested party so desire, the deputy commissioner must order a hearing before an administrative law judge. See 33 U.S.C. Sec. 919(c) and (d); Pyro Mining Co. v....